Principals

1. Schumer speaks to Semafor
2. Trade war
3. Budget week
4. Trump nominees advance
5. Rubio taps MAGA media figure
6. USAID under threat
7. New DNC chair

PDB: Trump admin pressed for briefing on China’s Iran support

Rubio warns Panama … Trump vows tariffs on Europe … WSJ: China preps opening bid for trade talks with US

Schumer plots Dem comeback

Chuck Schumer has been here before, leading Democrats through a powerless period after a decisive Republican presidential win by Donald Trump. He had some advice for his party on what will help in an interview with Semafor’s Burgess Everett: “Trump will screw up.” First there was the OMB memo suggesting a massive budget freeze. Then Trump moved ahead with tariffs on Canada and Mexico. Both times, Schumer quickly mobilized his media strategy while ignoring other outrages. “I didn’t know he’d screw up so soon,” Schumer said of Trump. “This is going to be a pattern.” And in addition to the nomination fights straight ahead, the Democratic leader is already moving to tweak Democrats’ immigration stance and target the GOP’s tax plans in the midterms. “We’re going to do a lot better in the Senate than people think,” he said of next year’s races.

Trump tariffs test allies, Congress

Trump’s decision to follow through with tariffs on Canada, Mexico, and China puts him on a collision course with major US trading partners, the business community, and possibly Congress. Canada and Mexico are already promising retaliatory tariffs in response to the duties, while China is weighing its own. Trump’s tariffs, which rattled stocks, are supposed to take effect Tuesday and will raise prices on cars and other goods. Business groups elated by Trump’s deregulatory plans criticized his tariffs as bad for US industries. Trump, who plans to speak to the leaders of Canada and Mexico today, insisted any pain “will all be worth the price that must be paid.” His use of the International Emergency Economic Powers Act to impose the duties tests the limits of his power and could lead to court challenges and pushback from Congress.

Republicans’ big budget week

The next steps in imposing Trump’s tax and border plans could prove a little tougher. The Budget Committee is expected this week to mark up a resolution that would guide the complex process Republicans want to use for party-line legislation. But budget hardliners are now looking for deeper spending cuts than what was circulated during last week’s GOP retreat, a Republican lawmaker told Semafor. Those initial suggestions were to slash more than $300 billion to pay for border security and tax cuts (though that’s not the entire cost of a plan likely to run into the trillions). The House is also planning further action to overturn Biden-era moves using the Congressional Review Act, and it aims to cap the week off with a vote on addressing the flow of fentanyl into the US.

— Kadia Goba

Kennedy nears critical vote

Trump’s most troubled nominees are nearing crunch time, with the Finance Committee voting on Robert F. Kennedy’s Jr.’s nomination to lead HHS on Tuesday and Tulsi Gabbard’s bid to be DNI nearing an Intelligence panel vote. Sen. Lindsey Graham, R-S.C., told Fox News Sunday that he’ll support both Gabbard and Kennedy, saying he’s “comfortable” with the way Kennedy has handled questions about implementing Trump’s anti-abortion policies and Gabbard’s comments on surveillance laws. But Sen. Bill Cassidy, R-La., a Finance Committee member, has yet to say how he’ll vote on Kennedy, acknowledging he’s “struggling.” Today, the Senate is expected to approve Chris Wright as energy secretary and advance Pam Bondi’s nomination to be attorney general, while Senate Majority Leader John Thune will move to tee up votes for later this week on White House budget nominee Russ Vought.

— Burgess Everett

Rubio taps MAGA media figure as undersecretary

Secretary of State Marco Rubio will appoint Darren Beattie as acting undersecretary of state for public diplomacy, two people briefed on the plans told Semafor. Beattie, a speechwriter in Trump’s first term who founded Revolver News, was fired in 2018 for attending a conference with white nationalists. (He wasn’t quoted saying anything notable there, and was later appointed to a federal commission by Trump.) He’s a far cry from the brand of pre-Trump conservatism Rubio once embodied, and marks the ascendancy of MAGA intellectuals within the bureaucracy. “Darren personifies the America First Right — smart, tough, relentless — with a ‘take no prisoners’ attitude,” the former Trump adviser Steve Bannon said in a text message. Beattie would need to be confirmed by the Senate to keep the post indefinitely.

— Ben Smith

Musk vows to shut down USAID

Trump’s latest target for drastic cuts is the US Agency for International Development. Trump “agreed that we should shut it down,” Elon Musk said overnight of USAID during a conversation on X Spaces. Trump separately claimed USAID — which handles foreign aid and development assistance — is run by “radical lunatics.” The president is eyeing an executive order that would fold USAID into the State Department, according to The Wall Street Journal. The Trump administration also placed USAID security officials on leave after they blocked Musk’s DOGE from accessing the agency’s restricted areas, The Washington Post reported. The plans set up a possible showdown with Congress, as Democrats warn Trump doesn’t have the authority to unilaterally reshape USAID. “Any attempt to reorganize or redesign USAID requires advance consultation with, and notification to, Congress,” Senate Foreign Relations Committee Democrats wrote in a letter to State.

New DNC chair helms troubled party

Democrats picked Ken Martin, a longtime state party chairman in Minnesota, to lead their national committee into the second Trump administration. Martin prevailed on the first ballot over Wisconsin chairman Ben Wikler, who’d been supported by billionaires George Soros and Reid Hoffman as well as party leaders like Nancy Pelosi. The short contest to lead the party settled no questions about Democrats’ November losses; Martin and Wikler pitched similar strategies to message outside the party’s shrinking base and fund downballot elections. Faiz Shakir, the manager of Bernie Sanders’ 2020 presidential bid, entered the race late to warn that “identity politics” and risk-averseness were costing them with lower-income voters. He won two of 428 votes. DNC members elected a crop of younger Democrats for other party roles, including David Hogg, the Parkland, Fla. school shooting survivor who became a gun control activist.

— David Weigel

Uncommon Bonds: Reclaiming bank executives’ pay

Banks were popular Washington targets in the Great Recession era, and they’re coming back under bipartisan scrutiny these days — as evidenced by Trump’s recent broadside against Bank of America and JPMorgan. Chief among big banks’ critics on the left is Sen. Elizabeth Warren, D-Mass., who penned a recent Wall Street Journal op-ed offering an olive branch to Republicans on economic policy. Among her suggestions for collaboration: a plan to rein in risky banking industry behavior by clawing back compensation from executives who preside over bank failures. She previously introduced a version of that proposal with Sen. Josh Hawley, R-Mo. Warren, the top Senate Banking Committee Democrat, tells Semafor she is in talks with committee colleagues and Republicans about moving forward on that bill and other “critical reforms.”

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Beltway Newsletters

Punchbowl News: Democrats are signaling they might not work with Republicans on a deal to fund the government, pointing to President Trump’s radical moves on tariffs and overhauling federal agencies. “[Decisions like these] increase our needs, which makes coming together harder. We could get to a tipping point where bipartisan cooperation becomes an overwhelming negative for us,” one senior House Democratic aide said.

Playbook: Retaliatory tariffs from Canada and Mexico could have a disproportionate impact on red states, which will test GOP unity on Trump’s tariff agenda.

WaPo: Ken Martin, the new DNC chair, has three big challenges awaiting him: spearheading a post-election review, figuring out Democrats’ strategy for countering Trump, and preparing for the fast-approaching New Jersey and Virginia gubernatorial elections.

White House

• President Trump fired Rohit Chopra, the Biden-era director of the Consumer Financial Protection Bureau.
• The Trump administration revoked TPS for Venezuelans living in the US.
• Vice President JD Vance is visiting East Palestine, Ohio, on the second anniversary of the train derailment there.

Congress

• Two Democrats on national security committees are pressing the Trump administration for information on China’s efforts to supply Iran with material to support its ballistic missile program. Citing recent reporting from The Wall Street Journal and other outlets, Reps. Raja Krishnamoorthi, D-Ill., and Joe Courtney, D-Conn. asked Secretary of State Marco Rubio and CIA Director John Ratcliffe for a briefing on the situation and any responses the US is considering, according to a letter shared first with Semafor.

Outside the Beltway

• Marchers in Los Angeles shut down a freeway while protesting President Trump’s deportations.
• Canadian sports fans began booing the US national anthem during cross-border games in Toronto and Vancouver.

Economy

• OPEC+ won’t bow to President Trump’s demand for it to ramp up production and lower prices, an oil and gas expert wrote in a Semafor column.

Transportation

• Transportation Secretary Sean Duffy assured Americans that it is safe to fly following plane crashes near Washington and in Philadelphia, and after the FAA’s NOTAM collision prevention system suffered an hourslong outage.

Courts

• In his rush to free people who’d been given excessive prison sentences for drug crimes, Joe Biden also pardoned some people with violent histories who otherwise wouldn’t have qualified. — WSJ

Foreign Policy

• Some PEPFAR work is continuing despite the Trump administration’s pause on foreign aid. — Devex

Media

• Former Biden White House spokesman Andrew Bates has some advice for Democrats’ messaging strategy — and he’s publishing it in Fox News this morning. Bates urges Democrats to focus on attacking President Trump’s economic agenda and accuse him of quickly breaking his campaign promise that he would cut costs. “Don’t reflexively oppose every last thing Trump does; make this economic contrast stand out,” Bates writes.

Principals Team

Edited by Morgan Chalfant, deputy Washington editor

With help from Elana Schor, senior Washington editor

Contact our reporters:

Burgess Everett, Kadia Goba, Shelby Talcott, David Weigel

Matt Boyle is the Washington bureau chief for the conservative publication Breitbart News.

Saudi Arabia’s main objective in attracting foreign investment is to unlock its labor force to develop goods and services that can compete globally, marking a shift for a kingdom known as a source of long-term capital for western companies.

The goal is to diversify the economy and “detach ourselves from having to need to rely on oil flow,” Saudi Minister of Economy and Planning Faisal Alibrahim said in an interview with Semafor.